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11/06/1980A G R E E M E N T THIS CONTRACT OF LEASE is made and entered into on the 6th day of November , 1980, by and between the COUNTY OF MONROE, STATE OF FLORIDA, a political subdivision of the State of Florida, hereinafter referred to as Lessor, and PROVINCETOWN-BOSTON AIRLINE, INC., a Massachusetts corporation authorized to do business in the State of Florida, hereinafter referred to as Lessee. W I T N E S S E T H: WHEREAS, Lessor owns an airport known as Key West International Airport located in Key West, Monroe County, State of Florida, here- inafter called the "AIRPORT", and WHEREAS, Lessee is engaged in the business of air transportation with respect to persons, property, cargo and mail, and WHEREAS, Lessee desires to obtain certain rights, services and privileges in connection with the use of the Airport and its facili- ties; and the Lessor is willing to grant and lease the same to Lessee on a non-exclusive basis upon the terms and conditions herein- after stated, NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants and agreements herein contained, and other valuable considerations, Lessor does hereby grant and lease unto Lessee, and Lessee does hereby hire and take from Lessor, certain premises, facilities, rights, licenses, services and privileges in connection with and on the Airport, as follows, to -wit: ARTICLE I - PREMISES A. PREMISES LEASED. The Lessor does hereby lease to the Lessee that space as marked as enclosed on Exhibit "A" attached hereto and made a part hereof at the Key West International Airport located in Key West, Monroe County, Florida, in accordance with the terms and conditions as set forth in this agreement. B. USE OF THE AIRPORT. Lessee shall be entitled to use, in common with others authorized to do so, of the Airport and appur- tenances, together with all facilities, equipment, improvements -2- and services which have been or may hereafter be provided at or in connection with the Airport for common use, in the operation of a transportation system by aircraft for the carriage of persons, property, cargo, mail and related purposes (hereinafter referred to as Air Transportation), which use without limiting the generality hereof, shall include: 1. the handling, ticketing, billing and manifesting of passengers, baggage, cargo, property and mail in Air Transportation by Lessee or on behalf of any other certificated air transportation com- pany. 2. the repairing, servicing, maintaining, condition- ing, testing, parking or storage of aircraft or other equipment operated by the Lessee, or of any other certificated air transportation company, provided that such right shall not be construed as authorizing the conduct of a separate business by the Lessee, but shall permit the Lessee to perform such functions only as an incident to its conduct of Air Transportation. 3. the training on the Airport of personnel in the employ of or to be employed by the Lessee, or any other certificated air transportation com- pany, or the Federal Aviation Administration, provided that such right shall not be construed as authorizing the conduct of a separate business by the Lessee, but shall permit the Lessee to per- form such functions only as an incident to its conduct of Air Transportation. 4. the purchase, sale, lease, transfer, disposal or exchange of Lessee's aircraft, engines, acces- sories, and other equipment or supplies; provided that such right shall not be construed as author- izing the conduct of a separate business by the Lessee, but shall permit Lessee to perform such functions only as an incident to its conduct of Air Transportation, and specifically, but without limitations, shall permit the purchase, sale, lease, transfer or disposal of any article or goods used by or bought for use by the Lessee in connection with its conduct of Air Transportation; and provided the Lessee shall not sell food or beverages (except as provided in Paragraph 10 of this Article I) nor gasoline, fuel or propellants, greases or other lubricants, except when such gasoline, fuel or propellants, greases or other lubricants are of a particular grade desired by others and are not otherwise available (except from other certificated air transportation com- panies) at the Airport. 5. the servicing by Lessee or others of aircraft operated by Lessee and other equipment on the apron by truck or otherwise, with gasoline, oil, greases, lubricants, and any other fuel or pro- pellant or other supplies, including food and -3- beverages required by the Lessee; such right to include, without limiting the generality there- of, the right of Lessee to install and maintain on the Airport adequate storage facilities for such gasoline, oil, greases, lubricants and other fuel, or propellant, or supplies, either under- ground or on the surface, together with the necessary pumps, pipes, motors, filters and other appurtenances incidental to the use thereof, all subject to approval by the Lessor of plans, specifications, location and in- spection of same, which approval shall not be unreasonably withheld. Lessor agrees to grant and make available to Lessee's use adequate and convenient rights -of -way on Airport property for said pipe lines, provided that Lessee shall be responsible for the cost of excavation, con- struction, installation, maintenance and opera- tion thereof, subject to the Lessor's written approval and subject to the execution of a separate fuel storage form agreement. 6. the landing, taking off, flying, taxiing, towing, parking, loading and unloading of Lessee's air- craft, or other equipment operated by Lessee, used in the operation of scheduled, shuttle, courtesy, test, training, inspection, emergency, special, charter, sightseeing and other flights, including without limiting the generality hereof, the right to load and unload Lessee's aircraft, or the air- craft of any other certificated air transporta- tion company adjacent to a convenient entrance to the Terminal Building; provided that flights carrying cargo or freight only shall load and unload at convenient and accessible points to be designated by the Lessor. 7. the loading and unloading of property, cargo, and mail at said Airport by such motor vehicles or other means of conveyance as Lessee may de- sire or require in the conduct of Air Transpor- tation, with the right to designate the particular carrier or carriers who shall regularly transport Lessee's property, cargo and mail to and from the Airport. 8. the right, subject to approval by Lessor of plans, specifications, location and inspection of the same, to install, maintain and operate, without cost to the Lessor, by Lessee alone, or in conjunction with others who are Lessee's at the Airport, or through a nominee, a message tube system and other communications systems be- tween suitable locations, subject to payment by Lessee for any space used. 9. the right to install, maintain and operate, with- out cost to Lessor, by Lessee alone, or in con- junction with any certificated air transportation companies who are Lessee's at the Airport, or through a nominee, any additional air condition- ing equipment including, without limiting the generality hereof, the operation of an air con- ditioning truck equipment for the air condition- ing of an aircraft, subject to payment by Lessee -4- for any space used for any fixed installation of air conditioning equipment, subject to writ- ten approval by the Lessor and subject to availability of space. 10. the right to provide, without cost to Lessor, by Lessee, food and beverages for consumption by passengers and crews, or for consumption by passengers and crews in aircraft grounded at the Airport, due to weather or mechanical condi- tions. Food and beverages may be served in the Lessee's exclusive space to its passengers and crews. Without limiting the generality of the foregoing, the said right shall include the right to install, maintain and operate, by Lessee alone and not in conjunction with others, without cost to the Lessor, on any premises leased exclusively to Lessee, and approved for this use by Lessor, at the Airport, a kitchen or other plant for the purpose of preparing or dis- pensing food and beverages (including alcoholic) for consumption as aforesaid. Except to the ex- tent hereinabove specifically provided, nothing in this paragraph shall be deemed to give Lessee the right to maintain or operate a cafeteria, restaurant, vending machine, bar or cocktail lounge for the purpose of selling, or in any manner otherwise provide for the sale of food or beverages to the public or to its employees and passengers provided, however, nothing con- tained in this paragraph shall preclude Lessor and Lessee under this Airport Agreement from concluding lease agreements covering separate hangar or service buildings, which leases may contain a provision giving Lessee the right to maintain an employee's cafeteria and/or vending machines in the event the restaurant concession- aire at the airport shall decline to operate a facility convenient to such separate buildings. 11. the right to install and operate, on and in the Terminal Building, at Lessee's expense, identifi- cation signs representing its business, which signs shall be substantially uniform in size, type and location with those of other air trans- portation companies, the number, general type, size, design and location of such signs to be subject to the written approval of Lessor in advance of installation, such approval shall not be unreasonably withheld. 12. the right to install, maintain and operate, at Lessee's expense, by Lessor alone, or in con- junction with any other certificated air trans- portation companies who are Lessee's at the airport or through a nominee, such radio commu- nications (including ARINC), meterological and aerial navigation equipment and facilities in or on premises leased exclusively to Lessee and subject to the approval of Lessor with respect to the location of installation, if outside the premises leased exclusively by the Lessee, sub- ject to the availability of such space and/or ground areas as determined by the Lessor and at mutually agreed upon rental rates. -S- 13. the rights and privileges granted the Lessee under paragraphs S, 7, 8, 9 and 12 of this Article I may be exercised by the Lessee for or on behalf of any other certificated air trans- portation Company or by or through a nominee of Lessee, which nominee shall have been first approved by Lessor in writing, and such approval shall not be unreasonably withheld; provided, however, that any such nominee shall have no greater rights than the Lessee hereunder. Lessor agrees that it will levy no charge or toll upon any nominee appointed by the Lessee pursuant to paragraph 13, other than for space occupied and facilities and ser- vices used. Except as specifically provided for in this paragraph B, nothing herein shall be deemed to give Lessee any right or permission to sell at the Airport any goods or services to the public or to its em- ployees and passengers, other than the Air Transportation Services, and the customary services incidental thereto. Such prohibi- tion includes, without limiting the generality of the foregoing, trip insurance unless not otherwise available in the Terminal Building other than from a certificated air transpor- tation company. C. SPACE IN AND ADJACENT TO TERMINAL BUILDING. Lessee is hereby granted the non-exclusive use, in common with others, of such space and failcities as may be designated by Lessor in or adjacent to said Terminal Building consisting of a ground area to permit the taxiing, servicing, loading and unloading fo Lessee's aircraft, space for reasonable amount of apron equipment, paving, loading gates, and lighting for loading ramps and for other areas adjacent to the Terminal Building and used by passengers. Lessee may use such space in the Terminal Building with respect to which it is granted the exclusive use hereunder and all such space and faiclities inside or outside the Terminal Build- ing with respect to which it is granted the non-exclusive use hereunder, subject to reasonable rules and regulations of Lessor as to the use of such space and facilities, for any or all pur- poses in connection with or incidental to its business of Air Transportation including, without limiting the generality hereof, the handling, ticketing, billing and manifesting of passengers, baggage, cargo, property and mail and the installation, main- tenance and operation of radio and other communications equipment M and facilities, and meterological and navigation equipment and facilities. D. PARKING SPACE. Adequate and reasonably convenient vehicular parking spaces shall be provided by Lessor at a location selected by Lessor, where it will not interfere with operations at the Airport, for the use of Lessee and its employees. Lessor may charge such employees a fee in connection therewith. E. RIGHT OF INGRESS AND EGRESS. The right of ingress to and egress from, but not the use of, except as provided in this lease, the premises and facilities referred to in Sections "B" to "D" inclusive above, for Lessee, its employees, agents, passengers, guests, patrons, its suppliers of materials or furnishers of ser- vice, its aircraft, equipment, vehicles, machinery or other property, its employees, agents, passengers, guests, patrons, suppliers of materials or furnishers of service or their said property except as herein, otherwise provided; and provided further that nothing herein contained shall be deemed to limit Lessor's right to impose charges upon ground transportation services. ARTICLE II - TERM This lease and all rights herein granted Lessee shall become operative and effective the 24th and shall end on the 31st day of October , 1980, day of March unless sooner terminated as hereinafter provided. ARTICLE III - RENTALS AND FEES , 1984, Lessee agrees to pay Lessor at such places as Lessor may designate for the use of the premises, facilities, rights, licenses, services and privileges granted hereunder, the following rentals, fees and charges, all payable in monthly installments covering the ensuing calendar month except that landing fee payments shall cover the preceding calendar month. In the event that the commencement of termination of the term with respect to any of the particular premises, facilities, rights, licenses, services and privileges as herein provided falls on any date other than the first or last Q -7- day of a calendar month, the applicable rentals, fees and charges for that month shall be paid for said month prorata according to the number of days in that month during which said particular premises, facilities, rights, licenses, services and privileges were enjoyed; and Lessor shall, following the end of each calendar month, transmit to Lessee a statement of the fees and charges other than monthly rentals incurred by Lessee during said month as herein- after provided, and the same shall be paid by Lessee within ten (10) days after receipt of such statement. Monthly rentals shall be due and payable on the first of each and every month with any billing statement to be made by Lessor. A. RENTAL WITH RESPECT TO EXCLUSIVE SPACE IN THE TERMINAL COMPLEX. From and after the effective date hereof a one month's advance deposit of rental as shown below shall be made to Lessor. Rental of such space herein leased exclusively to Lessee as shown on Exhibit "A" attached hereto and made a part hereof, shall be at the following rates payable monthly the first of said payments to be due the 24th day of October , 1980, and one of said monthly payments to become due and payable on the first day of each and every month thereafter during the term of this lease. 1. $100.00 per month payable in advance. 2. Lessee shall pay sales tax on all the rentals payable hereunder. B. LANDING FEES. From and after commencement of the term of this lease, rentals, fees and charges for the use of the landing area and facilities necessary therefore as granted hereunder, except those which rentals are specifically provided elsewhere, shall be combined in and represented by a landing fee based upon the approved maximum landing weights of the Lessee's Actual Revenue Trip Arrivals at the Airport each month as follows: $.16 per 1,000 pounds of approved maxi- mum gross landing weight. Lessee shall report to the Lessor not later than the loth day of each month, the Lessee's Actual Revenue Trip Arrivals at the Airport during the preceding calendar month, which shall include the number multiplied by the applicable approved maximum gross landing weights for each type of aircraft, shall determine the weight for which the monthly payment shall be made. The monthly reports above referred to shall also include and separately state the number and type of shuttle, courtesy, test, training, inspection, emergency and other non -revenue flights, landed at the Airport by Lessee. If, during any calendar year, the number of flights is greater than ten (10) percent of Lessee's Actual Revenue Trip Arrivals, Lessee shall pay regular landing fees upon such flights which exceed said ten (10) per cent allowance. Said fees shall be included by Lessor in its first regular monthly billing after the close of the calendar year. The term "approved maximum gross landing weight" for any aircraft as used herein, shall be the maximum gross landing weight approved by the Federal Aviation Administration for landing such aircraft at the Airport herein. Subject to reasonable rules and regulations adopted by the Lessor, it is expressly agreed that payment of landing fees shall entitle Lessee to the use of loading apron at or adjacent to the Terminal Building for such reasonable time as may be required by Lessee for the loading and unloading of its aircraft; provided, how- ever, that Lessee shall incur no penalty or charge for additional time resulting from unavoidable delays due to weather conditions, minor mechanical defects, or other delays beyond control of Lessee, except when such delays preclude use of the apron by other commer- cial air carriers that are operating to or from the Airport. Sub- ject to Lessee's rights under Article I B.6 hereof, the Lessor reserves the right to designate alternate parking areas if deemed desirable or necessary. Furthermore, in the event the Lessee de- sires to use the Airport apron and ramp facilities for aircraft storage purposes for more than twenty-four (24) hours prior approval must be obatined from the Lessor who will determine what apron or ramp areas are available for this purpose and the Lessor shall have the right to charge reasonable storage rates as mutually agreed upon between the Lessee and Lessor. MGM E. TAXES AND ASSESSMENTS. Lessee shall pay all taxes and assessments which may be lawfully levied by a duly constituted taxing body upon Lessee with respect to its operation at the Airport. The Lessor agrees not to levy any license or permit fee or special assessment on Lessee that would restrict or interfere with the exer- cise and enjoyment of the rights and privileges granted herein; pro- vided this shall not prevent the Lessor from making charges to Lessee for the use of the Airport, its facilities and services as herein specifically authorized. F. DEFAULT FOR FAILURE TO PAY RENTALS, FEES AND CHARGES. In the event Lessee fails to pay any rentals on the first of each month, or fails to pay charges and fees hereunder within ten (10) days after Lessor transmits a statement therefore to Lessee, such failure shall be a default of this lease. Lessor may, at its option, immediately or at any time thereafter, enter into and upon the premises hereby leased or any part thereof and in the name of the whole, and repos- sess the same of Lessor's former estate, and expel Lessee and those claiming by, through or under it, and remove its effects, forcibly if necessary, without being deemed guilty of trespass and without prejudice to any remedy which otherwise might be used for arrears of rent or preceding breach of covenant; on the re-entry aforesaid, this lease shall terminate. In the event Lessor is obligated to participate in any court proceedings in order to enforce any of its rights under this paragraph or to collect its rentals, fees and charges, Lessor, if successful in pursuing such litigation, shall be entitled to an additional amount in such sum as any District or Circuit Court having competent jurisdiction shall determine as a reasonable attorney's fee. ARTICLE IV - SERVICES TO PUBLIC Lessee may, alone or in conjunction with other certificated air transportation companies who are Lessees at the Airport, or through a nominee approved by Lessor, provide sufficient porter service, common bag claim service in the area designated herein for the convenience of its passengers provided, however, that Lessor -10- shall be under no obligation to provide or contribute to the fur- nishings of such service. ARTICLE V - RIGHT TO LEASE PROPERTY Lessor, represents that it has the right to lease the Airport, together with all premises, facilities, rights, licenses, services and privileges herein granted, and has full power and authority to enter into this agreement in respect thereof. ARTICLE VI - RIGHT TO PURCHASE SUPPLIES AND MATERIALS Lessee shall, except as herein otherwise provided, have the right to purchase or otherwise obtain personal property of any nature (including, but not limited to, gasoline, fuel, propellants, lubri- cating oil, grease, food, beverages and other materials, equipment and supplies) deemed by it to be required by or incident to, Lessee's operations, its exercise of the rights herein granted and its dis- charge of the obligations herein imposed, from any person, partner- ship, firm, association or corporation it may choose. Except as herein otherwise specifically provided, no charges, fees, or tolls, of any nature, direct or indirect, shall be charged by Lessor, directly or indirectly, against Lessee or its suppliers, for the privilege of purchasing, selling, using, storing withdrawing, hand- ling, consuming, loading or unloading, or delivering any such per- sonal property of Lessee by Lessee or its suppliers or for the privilege of transporting such personal property or persons to, from or on the Airport. Nothing in this lease shall be deemed to restrict in any manner Lessor's right to charge any person, partnership, firm, association or corporation rental for the use of Lessor's property or any im- provements thereon or thereto where such use of said property or improvements are of a regular or permanent nature as distinguished from a temporary or transitory nature or where such use is of such a nature as to constitute the performance of a commercial business at the Airport. Lessor shall make no charge for surface transpor- tation of Lessee's passengers when such passengers are carried to or from the Airport at Lessee's expense occasioned by flight cancel- -11- lations. Lessor shall have the right to charge persons, partner- ships, firms, associations or corporations, a fee for the sale and serving of food and beverages to Lessee at the Airport for consump- tion on its aircraft aloft; provided, however, in the event the Lessee maintains a flight kitchen at the Airport for the prepara- tion of food, no such fee shall be charged to the suppliers of unprepared food to the said flight kitchen; and provided further that no such fee shall be charged to any persons, partnerhips, firms, associations or corporations operating off the Airport from which the Lessee may purchase in-flight meals and beverage require- ments if Lessee is forced to discontinue its purchase of in-flight meals and beverage service from the Concessionaire to meet Lessee's standards as to quantity, quality, cost of service. In the event said Concessionaire fails to furnish in-flight meals and beverage service in accordance with Lessee's reasonable and published stand- ards as to quantity, quality and cost of service, the Lessor shall promptly, upon receipt of written notice from Lessee, serve written notice on said Concessionaire to comply with such standards. Should the said Concessionaire continue to fail or refuse to meet such standards, within thirty (30) days after receipt of said notice to the Concessionaire, Lessee may, after five (5) days prior written notice to Lessor, and after demonstrating to Lessor that such Con- cessionaire has failed or refuses to meet such standards, purchase its in-flight meals and beverage service from an off -the -Airport supplier without the assessment of any fee by Lessor as aforesaid. Should Lessee choose to purchase its in-flight meals and beverage service from an off -the -Airport supplier for any other reason than that set forth above, then in such event, Lessor may assess a fee (but not in excess of the fee assessed the said Air- port Concessionaire) on the off -the -Airport supplier for sale of in-flight meals and beverage service to Lessee. ARTICLE VII - MAINTENANCE AND OPERATIONS BY LESSOR Except as otherwise specifically provided herein Lessor, during the term of this lease, shall operate, maintain and keep in good -13- facilities for passenger or public use in the Terminal Building or elsewhere on the Airport. Lessor shall supply adequate light and water for the public and passenger space in the Terminal Building. Lessee shall not per- form any cleaning or maintenance of aircraft except in designated area under separate lease. Further, it is specifically agreed that no cleaning or maintenance of aircraft shall be performed on Airport runways or ramps. Lessee shall pay for its own electrical power in its exclusive areas, which power shall be separately metered. The Lessee shall, at its expense, repair, maintain or replace, as may be required, all plumbing fixtures, electrical incandescent bulbs or fluorescent tubes or other lighting devices located in its exclusive areas within the space leased hereunder. Lessor, at its cost, shall also provide and supply adequate lighting for the common departure area, vehicular parking spaces, loading ramps, adequate field light- ing on and for the Airport, including without limiting the generality hereof, landing lights and beacons. Lessor shall also provide 'jani- torial services necessary to keep the common departure area, the public and passenger space, and vehicular parking spaces and the landing field of the Airport at all times clean, neat, orderly, sani- tary and presentable. Determination of adequacy, as used throughout this ARTICLE VII, shall be made solely by Lessor but shall be at least equal to the standards for airports of substantially similar size and nature. ARTICLE VIII - GOVERNMENTAL FACILITIES It is expressly agreed that if funds for the provision, main- tenance and operation of the Control Tower and/or other air naviga- tion aids or other facilities required or permitted by the United States and needed by the Lessee or Lessee's operation at the Air- port, which are now, or may be hereafter furnished by the United States, are discontinued by the United States, Lessor shall not be required to furnish said facilities. ARTICLE IX - RULES AND REGULATIONS Lessor shall have the right to and shall adopt and enforce reasonable rules and regulations, which Lessee agrees to observe -12- repair the Airport, Terminal Building, vehicular parking space, all appurtenances, facilities and services now or hereafter connected with the foregoing, including, without limiting the generality hereof, all field lighting and other appurtenances, facilities and services which Lessor has agreed to furnish and supply hereunder. Provided, however, that Lessor shall not be required to perform maintenance and make repairs (a) in areas exclusively leased to Lessee or (b) to perform maintenance and make repairs occasioned by the negligence of Lessee or its employees, fire or other casualty excepted, in which case Lessor may perform such maintenance or make such repairs and charge the reasonable cost of same to Lessee. Pro- vided also that Lessor may abandon certain facilities which are no longer reasonably justified for proper and adequate operation at the Airport. Lessor shall keep the Airport free of obstructions, includ- ing the clearing and removal of grass, stones, or other foreign matter, as reasonably necessary and with reasonable promptness, from the runway, taxiway and loading area, and immediately adjacent to such runways, taxiway and loading areas for the safe, convenient and proper use of the Airport by Lessee, and shall maintain and operate the Airport in all respects in a manner at least equal to the highest standards or ratings issued by the Federal Aviation Administration, for airports of substantially similar size and character and in accordance with all rules and regulations of the Federal Aviation Administration and any other Governmental Agency having jurisdiction thereof, providing that nothing herein contained shall be deemed to require Lessor to enlarge the Airport or to make extensions or addi- tions to the landing area, runway, taxiway, or other appurtenance of the Airport. Lessor, at its cost, shall keep the public and passenger space in the Terminal Building, including the common departure area, adequately supplied, equipped, furnished and decorated and shall maintain adequate directional signs in said spaces and in all other public and passenger spaces at the Airport, including, but not limited to signs indicating the location of all public restaurants, restrooms, newsstands, telephones, baggage counters and all other -15- tirety or to cancel, as of the date of such damage or destruction, such part of this agreement as relates only to said buildings. ARTICLE XI - CANCELLATION BY LESSOR The Lessor may cancel this agreement by giving Lessee sixty (60) days advance written notice to be served as hereinafter provided upon or after the happening of any one of the following events: 1. The filing by Lessee of a voluntary petition in bankruptcy. 2. The institution of proceedings in bankruptcy against Lessee and adjudication of Lessee as a bankrupt pursuant to such proceedings. 3. The taking by a court of jurisdiction of Lessee and its assets pursuant to proceedings brought under the provisions of any Federal re -organiza- tion act. 4. The appointment of a receiver of Lessee's assets. 5. The divestiture of Lessee's estate herein by other operation of law. 6. The abandonment by Lessee of its conduct of air transportation at the Airport for a period of ninety (90) days. 7. The default by Lessee in the performance of any covenant or agreement herein required to be performed by Lessee other than failure to pay rentals, fees and charges when due for which provision is made in Article III F, and the failure of Lessee to remedy such default for a period of sixty (60) days after receipt from the Lessor of written notice to remedy the cancellation, as above provided, shall be of any force or effect if Lessee shall have remedied the default prior to Lessor's notice of cancel- lation. 8. The lawful assumption by the United States Government or any authorized agency thereof of the operation, control, or use of the Air- port and facilities, or any substantial part or parts thereof, in such manner as substan- tially to restrict Lessee, for a period of at least ninety (90) days, from operating there- on for the carrying of passengers, cargo, and property. No waiver of default by the Lessor of any of the terms, coven- ants or conditions hereof to be performed, kept and observed shall be construed to be or act as a waiver of any subsequent default of any of the terms, covenants and conditions herein contained to be performed, kept and observed by the Lessee shall not be deemed a waiver of any right on the part of the Lessor to cancel this lease -14- and obey, with respect to use of the Airport Terminal Building and appurtenances; provided that such rules and regulations shall not be inconsistent with this agreement nor with the safety and with rules, regulations and orders of the Federal Aviation Administration with respect to aircraft operations at the Airport and with pro- cedures prescribed or approved from time to time by the Federal Aviation Administration with respect to the operation of Lessee's aircraft at the Airport. Lessor shall provide Lessee with a copy of such rules and regu- lations from time to time. ARTICLE X - DAMAGE OR DESTRUCTION OF PREMISES If any building of Lessor in which the Lessee occupies exclusive space hereunder shall be partially damaged by fire, explosions, the elements, the public enemy or other casualty, but not rendered un- tenantable, the same shall be repaired with due diligence by Lessor at his own cost and expense. If the damage shall be so extensive as to render such building untenantable but capable of being repaired within thirty (30) days, the same shall be repaired with due dili- gence by Lessor at its own cost and expense, and rents payable here- under with respect to the Lessee's exclusive space shall be pro- portionately paid up to the time as such building shall be fully restored. In case any such building is completely damaged by fire, explosion, the elements, the public enemy or other casualty, or so damaged that it will or does remain untenantable for more than thirty (30) days, the Lessor shall be under no obligation to repair and reconstruct such building, and rent payable hereunder with re- spect to Lessee's exclusive space in said building shall be propor- tionately paid up to the time of such damage or destruction and shall thenceforth cease until such time as the premises may be fully restored. If within ninety (90) days after such damage or destruc- tion, Lessor fails to notify Lessee of its intention to repair or reconstruct the damaged or destroyed building or to furnish a sub- stantially equivalent facility, Lessee may give Lessor written notice of its intention to then cancel this agreement in its en- -16- for failure by Lessee to so perform, keep or observe any of the terms, covenants or conditions of this lease. ARTICLE XII - CANCELLATION BY LESSEE Lessee may cancel this agreement any time that Lessee is not in default in its payments to Lessor hereunder, by giving Lessor sixty (60) days advance written notice to be served as hereinafter pro- vided, upon or after the happening of any one of the following events: 1. Issuance by any court of competent jurisdic- tion of an injunction in any way preventing or restraining the use of the Airport or any part thereof for airport purposes, and the re- maining in force of such injunction for a period of at least ninety (90) days. 2. The inability of Lessee to use, for a period in excess of ninety (90) days, the Airport or any of the premises, facilities, rights, licenses, services or privileges leased to Lessee hereunder, because of fire, explosion, earthquake, other casualty, or acts of God or the public enemy, provided that same is not caused by negligence or willful acts of fail- ure to act on part of Lessee. 3. The default by the Lessor in performance of any covenant or agreement herein required to be performed by the Lessor and the failure of Lessor to remedy such default for a period of ninety (90) days after receipt from Lessee of written notice to remedy same; provided, how- ever, that no notice of cancellation, as pro- vided above, shall be of any force or effect if Lessor shall have remedied the default prior to receipt of Lessee's notice of cancel- lation. 4. The lawful assumption by the United States Government or any authorized agency thereof of the operation, control or use of the Air- port and facilities, or any substantial part or parts thereof, in such a manner as sub- stantially to restrict Lessee, for a period of at least ninety (90) days, from operating thereon for the carrying of passengers, cargo, property, and United States Mail. S. The failure or refusal of the Civil Aero- nautics Board to grant Lessee the right to operate into and from said Airport and the issuance by the Civil Aeronautics Board of a final order of suspension, termination or revocation of Lessee's authority to provide service at Key West International Airport, Monroe County, Florida. Lessee's performance of all or any part of this agreement for or during any period or periods after a default of any of the terms, -17- covenants and conditions herein contained to be performed, kept and observed by Lessor, shall not be deemed a waiver of any right on the part of Lessee to cancel this agreement for failure by Lessor to so perform, keep or observe any of the terms, covenants or con- ditions hereof to be performed, kept or observed. No waiver of default by Lessee of any of the terms, covenants or conditions hereof to be performed, kept, and observed by the Lessor shall be construed to be or act as a waiver by Lessee of any subsequent de- fault of any of the terms, covenants and conditions herein contained to be performed, kept and observed by the Lessor. ARTICLE XIII - INDEMNITY Lessee agrees fully to indemnify, and save and hold harmless, the Lessor from and against all claims and actions and all expenses incidental to the investigation and defense thereof, based upon or arising out of damages or injuries to third persons or their property, caused by the negligence of Lessee, its agents or employ- ees, in the use or occupancy of the said leased premises, runways, ramps or common areas at the Airport by Lessee; provided, however, that Lessee shall not be liable for any injury or damage or less occasioned by the negligence of Lessor, its agents or employees; and provided, further that Lessor shall give to Lessee prompt and reason- able notice of any such claims or actions and Lessee shall have the right to investigate, compromise and defend the same. Lessee agrees to carry, and keep in force, public liability insurance covering personal injury and property damage, and such other insurance as may be necessary to protect Lessor herein from such claims and actions aforesaid, Lessee agrees to carry and keep in force such insurance with minimum limits of liability for personal injury in a sum not less than $100,000 for any one person, and $300,000 for any one accident; and for property damage in a sum not less than $200,000; and to furnish Lessor with proper certificates certifying that such insurance is in force. Lessee shall carry its insurance coverages with insurance companies authorized to do business in the State of Florida. ARTICLE IV - QUIET ENJOYMENT Lessor agrees that, on payment of the rent and performance of the covenants and agreements on the part of Lessee to be performed hereunder, Lessee shall peaceably have and enjoy the leased premises and all rights and privileges of said Airport, its appurtenances and facilities granted herein. ARTICLE XV - SURRENDER OF POSSESSION Upon the expiration or other termination of this lease or any renewal thereof, Lessee's right to use the premises, facilities, rights, licenses, services and privileges herein leased shall cease and Lessee shall forthwith upon such expiration or termination surrender the same. Except as otherwise provided in Article XV, all structures, fix- tures, improvements, equipment and other property bought, installed, erected or placed by Lessee in, on or about the Airport and premises leased under this lease (such fixtures, improvements and other property to include, without limiting the generality hereof, storage tanks, pipes, pumps, wires, poles, machinery and air conditioning equipment) shall be deemed to be personalty and remain the property of the Lessee and Lessee shall have the right at any time during the term of this agreement, or any renewal or extension hereof, and for an additional period of ninety (90) days after the expiration or other termination of said term as the same may be renewed or extend- ed, to remove any or all of its property from the Airport; provided, however, that Lessee is not in default in its payments to Lessor hereunder and provided Lessee shall restore said premises to its original condition as at the beginning of occupancy, ordinary wear and tear, damage by elements, fire, explosion or.other causes be- yond control of Lessee excepted. Any and all property not removed by Lessee prior to the expiration of the aforesaid ninety (90) days period, shall thereupon become a part of the land on which it is located and title thereto shall thereupon rest in the Lessor. Pro- vided further that Lessor reserves the right to require Lessee to remove such improvements and property at Lessee's expense. -19- The Lessor reserves the right to make a reasonable charge of rental for the period of ninety (90) days provided for herein for continuation of occupancy of space; provided, however, that no charge shall be made to Lessee if Lessee shall remove its property from the leased premises within the first thirty (30) days of said ninety (90) day period. In the event that it becomes necessary for Lessor to remove equipment, structures or other attachments to the grounds or buildings because of the failure of Lessee to do so, the expenses of such removal are to be borne by the Lessee. ARTICLE XVI - DEFINITIONS OF TERMS Whenever the term Federal Aviation Administration is used in this lease it shall be construed as referring to the Federal Aviation Administration created by the Federal Government under the Federal Aviation Act of 1958, or to such other Federal Government authority as may be the successor thereto or to be vested with the same or similar authority. Whenever the terms "person" and "persons" are used in the lease, they shall be construed as including individuals, firms, corporations, and other legal entities. When in this agreement written approval by Lessor is required, such written approval may be given to the Direc- tor of Airports for Lessor. ARTICLE XVII - INSPECTION BY LESSOR Lessor may enter upon the premises now or hereafter leased ex- clusively to Lessee hereunder at any reasonable time for any purpose necessary, incidental to or connected with the performance of its obligations hereunder, or in the exercise of its governmental func- tions. ARTICLE XVIII - ASSIGNMENT AND SUBLETTING Lessee shall not at any time assign this agreement or any part thereof, nor sublet all or any portion of the leased premises herein without written approval of Lessor; provided that the foregoing shall not prevent the assignment of this agreement to any corporation with which Lessee may merge or consolidate, or which may succeed all or any portion of the business of Lessee. -20- ARTICLE IX - NOTICES Notices to Lessor provided for herein shall be sufficient if sent by certified mail, postage prepaid, addressed to: Director of Airports, Monroe County Key West International Airport S. Roosevelt Boulevard Key West, Florida 33040 and notice to Lessee, if sent by certified mail, postage prepaid, addressed to: Provincetown-Boston Airline, Inc. Naples Municipal Airport Post Office Box 1037 Naples, Florida 33939 or to such other respective addresses as the parties may designate to each other in writing from time to time. ARTICLE XX - PARAGRAPH HEADINGS The paragraph headings contained herein are for convenience of reference and are not intended to define or limit the scope of any provision in this lease. ARTICLE XXI - INVALID PROVISIONS In the event any convenant, condition or provision herein con- tained is held to be invalid by any court of competent jurisdiction the invalidity of any such covenant, condition or provision shall in no way affect any other covenant, condition or provision herein contained; provided that the invalidity of such covenant, condition or provision does not materially prejudice either Lessor or Lessee in its respective rights and obligations contained in the valid covenants, conditions or provisions of this lease. ARTICLE XXII - COVENANT NOT TO GRANT MORE FAVORABLE TERMS Lessor covenants and agrees not to enter into any lease, con- tract or agreement with any other air transport operator with respect to the Airport containing more favorable terms than this lease or to grant to any other air transport operator rights, privileges or concessions with respect to the said Airport which are not in accord to the Lessee hereunder unless the same terms, rights, privileges and concessions are concurrently made available to the Lessee. -21- ARTICLE XXIII - SUCCESSORS AND ASSIGNS BOUND BY COVENANTS All the covenants, stipulations and agreements in this lease shall extend to and bind the legal representatives, successors and assigns of the respective parties hereto. ARTICLE XXIV - NON-DISCRIMINATION CLAUSE The Lessee in exercising any of the rights or privileges herein granted to him shall not on the grounds of race, color or national origin discriminate or permit discrimination against any person or groups of persons in any manner prohibited by Part 15 of the Federal Aviation Regulations, and the Lessor is hereby granted the right to take such action, anything to the contrary herein not withstanding, as the United States may direct to enforce this non-discrimination covenant. ARTICLE XXV - INTERPRETATION OF LEASE Nothing in this lease shall be construed or interpreted in any manner whatsoever as limiting, relinquishing, or waiving of any rights or ownership enjoyed by Lessor in the Airport property, or in any manner waiving or limiting its control over the operation, main- tenance, etc., of Airport property or in derogation of such govern- mental rights as Lessor possesses, except as is specifically provided for herein. ARTICLE XXVI - RENTAL INCREASE The parties specifically agree that the rental rates previously provided for herein shall increase automatically seven (7) per cent per year. All increases in rental rates will be computed annually after the first year of this lease and be used for the following year's rental rates. ARTICLE XXIII - CONDITION "AS IS" The Lessee agrees to accept the premises which are exclusively leased to Lessee in "as is" condition and Lessor shall not be obligated to repair, maintain or renovate same. -22- IN WITNESS WHEREOF, the parties hereto have caused this lease to be executed as of the day and year first above written. (Seal) Attest: --�� er (Corporate Seal) Attest: ,�ecretary COUNTY OF MONROE, S TE OF FLORIDA By C airma of thd—Board of County Commissioners of Monroe County, Florida PROVINCETOWN-BOSTON AIRLINE, INC. By JqJ9,, # /44,7 IL4�L­. President EXHIBIT "A" A parcel of land on the Island of Key West, Monroe County Florida and being more particularly described as follows: Commence at the southeast corner of Tract 49 as recorded in Official Records Book G-66 at Page 148 of the Public Records of Monroe County, Florida, said Tract 49 also shown un-numbered (between Tract 47 and East Martello Tower) in the Plat of Survey as recorded in Plat Book 3, at Page 35 of the Public Records of Monroe County, Florida, said point being the easterly line of Tract 49 and the northerly Right -of -Way line (curb line) of South Roosevelt Boulevard; thence N62038147"E for 1044.65 feet to the Point of Beginning; thence N87014155"E for 73.56 feet; thence N04014139"W for 77.52 feet; thence S8704310911W for 73.84 feet; thence S0401413911E for 78.13 feet to the Point of Beginning; containing 0.13 acres more or less.